IB vs Actuarial Science

I'm considering a career in actuarial science at the moment but I've applied to many universities such as Warwick / lse which could still allow me to go into IB

I wanted to know what the advantages / disadvantages of each profession were and I'm not entirely sure of what goes on in IB if someone would like to explain?

I'm aware that IB is long hours and short lived career with more money but I'm not sure exactly what IB do.

is there more money to be made in IB or actuary? Which has more job security ?

Reply 1

Commercial Paper

Original post by TheActuary

Actuary is paid well and has good job security. IB is very volatile, short-lived and little job security but pays extremely well if you crack it.

Posted from TSR Mobile

Reply 2

TheActuary

Anybody care to comment on actuary vs investment banking?

http://www.thestudentroom.co.uk/showthread.php?t=2579357&goto=newpost

Reply 3

Crazy92

IB as you probably think of it is split into Investment Banking, Global Capital Markets and Sales & Trading.

Some people would call all three of these "Investment Bankers" it just depends on preference.

Typically:

Investment Banking: Deals with M&A, very long hours, workload skewed towards end of the day for juniors (hence up all night). Well paid.

GCM: Sits between IB and S&T, I like to think of GCM as clever enough to be S&T but can't really handle/enjoy the pressure. Again, well paid. Deals with debt structuring etc for corporates etc.

S&T: Generally high pressure, the markets facing side of the bank. If you are an outsider to the world of Investment Banking, then this is probably what you imagine working in IB being. Yet again, well paid. Arguably better work/life balance than the other two divisions. Weekends off, pretty much always. Long stressful working day during the week, expect 12-13 hours. Can be very early hours depending on the specific area. I.e Start at 5.45am. Though this can be 7.45 for some desks (not common though).

I think a good way to think of salary is this: The average Investment Banker will be paid more than the average guy/girl in S&T, but the best people in S&T will far out earn their colleagues in IB and GCM.

IB, GCM and S&T do not have good job security at all, this is factored into the salary.

Actuarial is no where near as well paid, generally more boring than S&T and not as difficult to break in to.
Can't do IB, GCM or S&T, go and be an actuary.

I hope that helps.

Reply 4

jj193

Crazy92 you're pretty ignorant about actuarial work being easy to break in to, off my head I can think of three people who chose GI actuarial work over opportunities in IB. I think Actuarial is good because Actuaries can have a better qualify of life, live outside london, and have more time for family etc. I'm not sure where the idea of job security comes from, actuaries don't have job security.

This is what actuaries in GI get paid:
25-35k graduate salary (you work on average 4 to 4.5 days a week)
increasing to 40-60k qualified (3 to 6 years later if you're committed to studying)
Manager (in charge of 3-10): 65-110k
Head of a department: 100k+
Chief Actuary/Actuarial Director/CRO: 120k+++++

As an example, I know someone who couldn't be bothered to qualify, has 11 years experience, a life, and took home c. 900k pre-tax over the last 6 years, including a 6 month break.

A big 4 actuarial partner will earn 600k+

This is all comparable to a quant salary when you consider that a 45+ hour week is unusual for an actuary.

(edited 10 years ago)

Reply 5

TheActuary

Original post by Crazy92

Thanks for your reply, its very helpful! but what do they do in each division? I've been considering IB and I've heard that if your looking at going into it you should know exactly which bit you want to go in so you can find a way in. Personally I want a big wage but dont want to be too too over worked, I dont mind hard weekdays and weekends off as long as there is a little bit of a break. I know quite a bit about actuary as that was going to be my original career plan and I know about all the different types of industries there are and what goes on but my knowledge on IB is poor.

Also is it possible to go into IB for a few years 6/7 and make a bit of money and then carry on into Actuary as Actuary is meant to allow you to have a better family life for kids etc. The degrees I've applied to such as MORSE at warwick still provide me exemptions from all core actuarial exams.

Also is IB like the typical stereotype of girls, private jets, alcohol and the 'baller' lifestyle, or is it not what you expect it to be when you first turn up for work?

Original post by jj193

Thanks for replying also! Actuary is constantly rated as one of the best professions to be in, taking into factors such as stress levels, pay, family life etc. But how much money does an experienced IB make compared to an experienced Actuary? and although it is possible to make over 600+ as being a partner of one of the big 4 companies, It isnt easy to become that and I'd count myself extremely luck if i managed that.

Reply 6

Crazy92

Original post by jj193

I don't think it's easy to break into. But I would strongly argue that it is harder to break into IB than actuarial.

Of these three people you know, what IB roles did they have opportunities in? Was it all FO IB?

Actuaries may not have job security, but the job security they have is better than the job security found in IB. Given that we are only comparing IB and actuarial science careers, then I feel that it is still a valid point.

Reply 7

Crazy92

Original post by TheActuary

Ok, so the four points highlighted above:

1. I have described the sub-divisions in IB, you can Google them and do the research yourself.

2. Who doesn't want that? Unfortunately a big wage and work are directly correlated.

3. I am not sure on the technicalities behind this ( I don't know enough about actuary). Also, it wouldn't make sense to work in IB for 6/7 years and then jump ship, as it's only after 6/7 years that you would be on serious money.

4. No, it's a perfectly normal job. A lifetime in IB might allow you to travel business class with your family or buy one nice car. You're not going to get a private jet out of it.